If Spencer Johnson’s Who Moved My Cheese? is a parable about adapting to change, Nvidia could be the case study for not only finding the cheese, but building a fully automated, AI-powered cheese factory and licensing the blueprints to everyone else.
Over the years, Nvidia has shifted from a niche graphics card maker to a global AI infrastructure leader. The old cheese was high margin and fast-selling gaming CPUs. The new cheese is data centre dominance, AI accelerators and software ecosystems that turn chips into platforms. That shift didn’t happen overnight; it took strong leadership and a willingness to cannibalise yesterday’s business to win tomorrow’s market.
Like Johnson’s characters, many companies cling to what worked in the past, waiting for the cheese to return. Nvidia did the opposite. The firm has retooled supply chains, embraced software-first thinking and now, as AI adoption accelerates and rivals rush to catch up, Nvidia faces another test - can it keep moving while carrying the crown? The burden of leadership can often be heavier than it looks and the company’s challenge will be to avoid getting comfortable. After all, in markets, as in life, the cheese is always on the move.
From graphics to generative AI
Our exposure to Nvidia is through diversified, thematic equity funds and part of a broader structural play on technological innovation. It is not about betting on a single company or one part of technology, we invest across supply chains, ecosystems and enablers. That means Nvidia sits alongside software platforms, semiconductor equipment makers and cloud service providers in portfolios. This diversification helps us participate in the growth of AI and high-performance computing without being overly reliant on one firm’s quarterly earnings.
Nvidia’s story is remarkable precisely because it has navigated multiple rounds of “cheese relocation” over the years. The company began as a graphics specialist, powering computer games in the late 1990s and early 2000s. Gaming GPUs were the cheese – high-margin, popular and defended by strong technical moats. For many companies, that would have been enough.
Instead, Nvidia spotted a shift early. It realised GPUs could be used to accelerate computing in fields far beyond gaming, like scientific research, machine learning, autonomous driving and data analytics. That pivot set the stage for Nvidia’s transformation into the world’s preeminent AI hardware supplier.
Why adaptation matters for investors
In Who Moved My Cheese? the characters who thrive are those who notice subtle changes before the cheese runs out. For investors, the analogy is clear – industries evolve, competitive advantages erode and the companies that succeed are those that keep moving.
In our portfolios, we apply the same thinking. We don’t back companies or funds simply because they’ve been leaders in the past. We are not over reliant on past performance and the best Sharpe ratios. We back those that demonstrate agility, vision and the willingness to disrupt themselves. Nvidia has done all three. It cannibalised parts of its own gaming GPU dominance to build its data centre business. It shifted from being a pure hardware seller to offering CUDA, its proprietary software platform, which locks developers into the Nvidia ecosystem. It reinvested aggressively in R&D to stay ahead of both incumbent rivals and nimble start-ups.
Having exposure to Nvidia is part of a decade-long view that AI, accelerated computing and advanced semiconductors will underpin the next wave of economic growth, but we also recognise that leadership is not permanent. The cheese will move again – and the question will be whether Nvidia keeps chasing change or if it will get complacent in its current position.
The current landscape
The AI boom has attracted a flood of new entrants. AMD and Intel are ramping up their accelerator offerings, while hyperscale cloud providers are designing in-house chips to reduce dependency on Nvidia. Start-ups, often backed by venture capital, are innovating in niche AI applications. In short – there are now more mice in the maze!
For Nvidia, the challenge will be to extend its lead through software integration, energy efficiency and scaling AI infrastructure while continuing to serve its core gaming, automotive, and professional visualisation markets.
For investors like us, it’s a reminder that concentration risk is real, even in the most innovative companies. That’s why, across our global thematic funds, Nvidia is one tile in a much larger mosaic. Our AI exposure spans cloud infrastructure operators, data storage providers, photonics specialists and power management firms because every technological shift has winners across the value chain, not just at the very top.
From Nvidia’s journey, three investment lessons stand out:
- Notice change early – Markets give off signals before the cheese moves. In Nvidia’s case, researchers began experimenting with GPUs for machine learning well before AI became mainstream.
- Be willing to pivot – True leaders don’t cling to past successes. Nvidia’s evolution from gaming to AI was not a gentle adjustment; it was a wholesale repositioning.
- Don’t overstay in one cheese room – Competitive dynamics can shift quickly. Even when you’re holding the market lead, the next disruption is already forming somewhere else in the maze. That’s why we diversify across themes and value chains.
Looking ahead
Nvidia’s valuation is a frequent topic of debate. Critics argue it has run too far, too fast; supporters see it as the foundational infrastructure provider for the AI era. Our view is pragmatic: while we remain constructive on the long-term opportunity, we also recognise that AI adoption will not be a straight line and there will be periods of digestion.
For now, Nvidia is posting record revenue and enjoying robust demand with an ecosystem advantage that competitors are still years from matching. The true test will come when the current AI boom matures. Will Nvidia be ready for the next relocation?
As thematic investors, we can’t predict exactly when the cheese will move. But we can build portfolios designed to follow it – wherever it ends up next.
